Kin Mining Share Price Breakout, Is It Too Late to Buy? (ASX:KIN)

Kin Mining Share Price Breakout, Is It Too Late to Buy? (ASX:KIN)

Shares in Kin Mining NL [ASX:KIN] have pushed past their 52-week high and are currently trading at 9.9 cents per share.

The junior gold explorer has beaten a number of its small-cap peers, with the KIN share price jumping 180% since the beginning of 2020 for a 12-month return of 53.13%.

ASX KIN Mining Share Price Chart

Source: Trading View

KIN has seen some good momentum in its share price since the beginning of May.

This could be due to a post-earnings announcement drift — as investors digest the information, momentum takes over and the price moves higher.

What’s driving the momentum?

Junior gold companies are among some of the most speculative on the ASX, but it’s always worth keeping one eye on financials.

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One of these is cash flow. Does the company have enough cash to sustain operations and ultimately find gold?

KIN completed a $2.64 million cap raise in mid-March to fund up to 22,000 metres of aircore drilling at its flagship Cardinia Project.

The share placement saw shares go at a premium of 9.8% to KIN’s last traded price at the time.

Initial results released in April show encouraging signs, which demonstrate a growing, large-scale mineralised system.

Although the share price didn’t budge at the time, the first five holes all intersected ore grade mineralisation at Cardinia Hill.

At time of the last quarterly update, the resource size at Cardinia was 21 million tonnes at 1.40g/t for 945,000 ounces of gold.

The resource is located at shallow depths too, meaning extraction (though they’re not at that stage yet) is far easier than a deeper resource.

It all sounds like a nice setup for KIN, yet from the graph we can see there wasn’t much action until May.

Perhaps no one was paying attention?

That is until news broke that Kerry Harmanis of Jubilee Mines had increased his stake in KIN from 15.2% to 17.4%.

Too late to buy?

Irrespective of its newfound hype, KIN has been producing more solid results at Cardinia.

Drilling results released yesterday show further intersecting shallow gold at Cardinia Hill and Helens prospects within the Cardinia Gold Project.

Though some of the results are not as high-grade as previously discovered, Managing Director Andrew Munckton says they confirm the geological continuity of the mineralisation over at least 500 metres.

Meaning KIN are successfully expanding on their 945,000-ounce resource.

KIN says there are still 3,500 meters of assays pending, results of which could be released in the coming weeks.

Something to be mindful of.


Lachlann Tierney,
For The Daily Reckoning Australia

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